joe lavorgna, chief u.s. economist at deutsche bank. welcome, gentlemen. >> let me start with you. as i bdz understand it, you are generally in favor of this with some exceptions. detail how you would find this a good plan. >> i think the important thing is to get the balance right. nobody wants to go back to the irresponsible lending of the last decade that really crushed the american economy. the problem now is that credit has gotten very, very tight and there may be room to find credit worthy borrowers in a larger pool, at least as i understand it, how the administration is talking about is providing clarity to lenders about the rules under which they put back mortgages in the event of future default and clarity and transparency on that is good and then secondly, to make sure that the loans that are being guaranteed by fha are reaching borrowers who have good, strong credit, but who may not fit the existing parameters fully. and i think getting the balance ready is important and nobody wants to go back to the decade of excess that we're finally coming out of today. >> joe, you'r

joining me right now, joe lavorgna, chief u.s. economist at deutsche bank, and nathan bachrach, the financial group ceo. gentlemen, welcome. thank you for joining us here "on the money." what do you think? nathan, we see the markets reaching or touching new highs almost on a daily basis during this first quarter. how much room do you think there is to run to the upside still? >> well, there is some room to the upside. it's all going to be independent on the retail investor and whether or not the $900 billion, bill, is still sitting in checking and savings accounts. if that starts to move, that could be the power that could really drive the market further, as long as we don't have disturbances in the force that would be europe. >> exactly. and joe, here in this country, housing seems to be a primary driver of our recovery, even though the data are mixed. let's take a listen to what david blitzer of standard & poor's had to say about that. >> overall we're about 9% above the lows for 20 city composite. we beat the consensus forecast

here now to talked is a former reagan deputy assistant secretary of the treasury and joe lavorgna, cnbcor. let me go to david malpass. their argument was 90% depth-to-gdp means the economy is going to fall but the upstarts from umass amherst say 90% of gdp, not great but you can still grow it over 2%. have they misled the world? >> hi, larry. well, i think it's pretty clear that when the governments grow bigger you get less growth. you're killing jobs and you're hurting the growth outlook, so that's what the debate is about, so people want to attack the study as a way to defend big government and more government spending. that's going on in washington all week with the imf annual meet >> joe, just on the numbers here. there's a difference between 2.2% which is what the amherst people, the umass people are saying and minus 0.9. one is a small recovery. the other is a recession, and after all, want it them using this formula, negative growth if it gets to 90%, they are the ones particularly advising europe with all the european austerity, with the tax hikes, for example, that have thrown